Payday loans could be trouble for veterans

September 21, 2012

State lawmakers who are considering House Bill 2191, a bill that would legalize high-cost (more than 300 percent annual percentage rate) payday loans in Pennsylvania, should take a lesson from the U.S. Department of Defense. The Department of Defense concluded that these loans were so financially harmful to our troops that they were undermining military readiness. As a result, President George W. Bush signed into law a 36 percent annual rate cap for payday loans made to active duty military members and their families.

Although the loans which HB 2191 seeks to bring to Pennsylvania cannot be legally offered to our full-time military, our National Guard and reserve members and our veterans and their families are not protected by the federal legislation, which is a very troubling proposition. Veterans already face fragile financial and emotional situations when they return home. Many manage on fixed incomes because of war-related disabilities. The loans legalized by HB 2191 would exacerbate, not solve, veterans' financial troubles. That's why the Pennsylvania War Veterans Council, representing our state's 960,000 veterans, recently voted unanimously to oppose HB 2191.

We urge our legislators to stand with Pennsylvania's military veterans and vote "no" on HB 2191.